I'm not fully sure on the RAM side of things.. (Lots of RAM is mostly helpful if you'll have lots of OXPs, particularly ones with lots of big textures in them. I have roughly 200 OXPs installed and 3GB of RAM. It goes reasonable well with Oolite, but I'd prefer to have at least another GB. Unfortunately, 3 is as much as my laptop can take.)
On the graphics card front, there are two aspects. The first is that ideally you want a card that fully supports at least
OpenGL 2.1.2, or better, for full shader effects. (If you have OpenGL 3.0+ capability, you'll be future-proofed for quite some time, with Oolite) The other is the amount of dedicated RAM for graphics. The more the better. 256MB is pretty much the low end of the scale if you have lots of eye-candy OXPs installed.
(Oh, and avoid Intel graphics chips like the plague. I'd estimate that 90% of the graphics problems we get asked about on the OoliteBB relate to Intel graphics. OpenGL is not Intel's strong suit.)
I think the 1.6, dual core CPU should be able to handle Oolite
I have a 1.7GHz core2 Duo in my laptop, and I'd rate it as just "adequate". Although I've noticed a fair improvement in game performance since some recent optimisations done in 1.79. It actually runs a lot better now than 1.77.1 does, for me, particularly when making witchjumps.